State Audit finds thousands in misspending by former ICN executive director

A report on a special investigation by the State Auditor details several issues of concern with the former leader of the Iowa Communications Network.

State Auditor Mary Mosiman says her office was asked to investigate after executive members of ICN said they had concerns regarding the purchase of pre-owned semi-trailers by former executive director Richard Lumbard. Mosiman says they found several instances where the decisions of Lumbard where not in the best interest of the taxpayers.

“We identified a number of instances in which he circumvented basic internal controls, circumventing their own controls, and circumvented requirements established by the state’s Department of Administration and Department of Management,” Mosiman says. She says Lumbard had the trailers delivered to a business he owned and sold equipment from the trailers and never deposited the proceeds of the sale into the ICN account.

Mosiman says there were also staff issues. “Using the authority of his position the former executive director created unnecessary positions, hired people not qualified for these positions, and awarded excessive pay increases,” according to Mosiman. “These actions resulted in payroll costs which were not reasonable or necessary for ICN operations.” Mosiman says Lumbard hired Jessica Jensen as his executive secretary. She had worked at his company and he gave Jensen a 14% pay increase after six months of employment with ICN and a 12% increase the following year. He also announced he was going to give Jensen assuming a position Mosiman says Jensen was not qualified to hold.

Mosiman says all the issues added up. “We identified a little over $379,000 of improper disbursements and undeposited collections. In addition, we determined that the governing body of ITC (Iowa Telecommunications and Technology Committee) is not taking an active role in the oversight of ICN as required by section 8 D of the code of Iowa,” Mosiman says. Lombard became ill and took a medical leave and was later fired.

“Any further action based on this report will be up to the partnership of the ICN and the ITC,” Mosiman says. Lumbard was appointed to lead the ICN in 2014, and the investigation covered the period from January 15th to January 2nd of this year. Lumbard was fired on January 4th.